The EU Regulation to reduce mobile roaming
charges before the final agreement: Frequently Asked
Questions

The EU's 27 Telecom Ministers will gather on 15
March at the CEBIT IT fair in Hannover/Germany for an informal EU Telecom
Council that could pave the way for a historic early adoption of the EU roaming
regulation proposed by the Commission on 12 July 2006. For the European
Commission, EU Telecom Commissioner Viviane Reding will attend the
meeting.

On the proposed EU Regulation on roaming, the European Council, which
includes the 27 Heads of State or Government and the President of the European
Commission, concluded last Friday in Brussels: "Every effort should be made
to successfully conclude the legislative process on the reduction of roaming
tariffs by the end of the first half of 2007." EU Telecom Commissioner
Reding commented on this: "A political agreement on an ambitious reduction of
roaming tariffs by summer is now within reach. I call on all Ministers and
Parliamentarians currently working on the Roaming Regulation proposed by the
European Commission last July to listen more to consumers and less to the
industry lobbyists. All citizens in the EU should be able to judge in July how
effective the work of their ministers and their Parliamentarians has
been."

What
does the European Commission's proposed regulation to reduce roaming tariffs
do?

With its proposal of 12 July 2006 for an EU regulation on mobile roaming in
the internal market, the European Commission seeks to reduce by up to 70% the
charges consumers currently have to pay for using their mobile phone abroad (IP/06/978).
To achieve this, price ceilings are set both at wholesale and at retail level to
ensure that mobile roaming charges are not unjustifiably higher than those
incurred by domestic mobile phone use. Below these ceilings, competition should
take place for the most attractive roaming packages.

The EU roaming regulation also will enhance price transparency. It obliges
mobile service providers to give personalised information on retail roaming
charges to their roaming customers – on request and free of charge.
Moreover, a customer subscribing to an operator will be able to receive detailed
information on roaming and operators will have to keep the subscriber informed
periodically on roaming charges.

What
is the current status of the Commission's roaming proposal and what are the next
steps?

The Commission is confident that the European Parliament and Council can
reach an agreement in the first reading on the EU Roaming Regulation before the
summer. Of course, to achieve this, further close cooperation between Parliament
and Council will be necessary.

The support for the overall objectives which the Parliament and Council have
already shown, is currently evolving into a consensus on the need for retail and
wholesale regulation, and improved transparency for consumers. Discussions are
concentrating at the moment on the method of wholesale and retail regulation and
on the scope of the EU Roaming Regulation (only voice roaming or also data
roaming). Further progress is expected from the informal ministerial meeting in
Hannover on 15 March 2007 that could pave the way for a final agreement in early
June. The German Presidency aims to secure an agreement in first reading during
the Telecoms Council 6-8 June.

In the European Parliament, the rapporteurs for the Committee on Industry,
Research and Energy (ITRE) and Committee on Internal Market and Consumer
Protection (IMCO) have already published their reports and will vote in March
and April. A plenary vote on the EU Roaming Regulation will take place in
May.

What
are the different views among the Commission, Parliament and Council?

There is broad agreement both on the objectives of the EU Roaming Regulation
among the Commission, Parliament and Council and on its general architecture (a
combination of wholesale and retail regulation), not to mention strong consumer
support (IP/06/1515).
The discussion now is centring on different ways in which the objectives can be
achieved through the regulation and on the level of the price caps – see
table below for a comparison of the different models currently under discussion.

Will
the proposed EU regulation address the wholesale market, the retail market or a
combination of the two?

Although the Commission generally prefers not to regulate retail markets, the
proposed EU regulation on roaming addresses the wholesale and the retail
level, due to the exceptional nature of the roaming market and its atypical
development. The Commission’s assessment is that market forces are still
insufficient to ensure that price reductions at wholesale level are passed on to
consumers in the retail market. Retail regulation ensures that savings are
passed on to consumers and that consumers will actually benefit from the new EU
Roaming Regulation.

Why
does the Commission support a single absolute retail price cap?

The Commission believes that a single absolute price cap adds simplicity and
therefore is a good basis to move forward. An absolute cap adds certainty for
operators and ensures that they will still be able to offer innovative prices at
the retail level. The level as proposed by the Commission is aimed at ensuring
this will still be a profitable business for operators. The Commission's view on
this issue is also supported by the European consumer organisation BEUC's recent
study published on 20 February – http://www.beuc.org. The alternative suggested by
some, namely to use average caps, would in the Commission's view create
unnecessary complexity, confusion and administrative burdens.

Should there be a general consumer protection tariff for roaming customers
at retail level?

There seems to be general agreement on the need for a consumer protection
tariff and thus for retail regulation. Such a tariff was already proposed by the
Commission in the regulation last July. The Commission is at the same time in
favour of flexibility in the market, provided that consumer confidence is not
abused or misled. Consumers should have to decide consciously to choose an
alternative package or tariff plan (opt-out), but failure to do so would mean
that they are automatically covered by the consumer protection tariff.

Would
consumers have to subscribe actively (opt-in) to the consumer protection
tariff?

No. In the Commission's view all consumers should be able to rely on the
consumer protection tariff and a suitable opt-out arrangement would have to be
in place to ensure this. The Commission believes this is the only approach that
guarantees that consumers get the level of protection they need. Opt-in, on the
other hand, would mean that operators would need to draw the attention of
consumers to the consumer protection tariff, but would have very little
incentive to do this in a way that represented the benefits of that tariff
fairly and objectively.

Does
the proposed EU regulation also cover SMS and data roaming?

The regulation as proposed on 12 July 2006 includes short message services
(SMS) and Multimedia Message Services (MMS) in their scope, but caps the roaming
prices only for voice services. It requires national regulators to
monitor developments in the prices of roamed SMS and data services closely. The
Commission calls on mobile operators to demonstrate very clearly in the weeks to
come their willingness to voluntarily reduce the very high roaming charges for
SMS and data roaming to avoid that also these charges need to be regulated.

When will the new EU regulation on roaming take effect?

The European Parliament and the Council of Ministers have to decide jointly,
under the so-called “co-decision procedure”, how and when to adopt
the Commission proposal, at which point it becomes binding law in all Member
States. The Commission believes that the Regulation should come into force by
summer 2007.

Further information:

The European Commission’s roaming website (IP/05/901),
includes samples of roaming tariffs per country as well as the results of the
Eurobarometer survey about citizens' views on roaming (IP/06/1515)
can be accessed at: